Volunteer Forces (Pay and Compensation)

Part of the debate – in the House of Commons at 12:56 am on 19th December 1990.

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Photo of Mr Kenneth Carlisle Mr Kenneth Carlisle , Lincoln 12:56 am, 19th December 1990

It is a great pleasure to reply to this short debate. I congratulate my hon. Friend the Member for Canterbury (Mr. Brazier) on raising the matter. We all know of his close interest in matters relating to the terms and conditions of service for members of the armed forces. As a member of the Territorial Army, he is exceptionally well qualified to debate this issue, and he did so with knowledge and sincerity.

I welcome the speech of the hon. Member for Motherwell, North (Dr. Reid) who made some excellent points. He also paid tribute to my hon. Friend.

I wish first to make some general points about terms and conditions in the armed forces, because that will help to place the particular points raised by my hon. Friend in a wider context. As my right hon. Friend the Secretary of State told the House on 17 December, in order to provide job protection, arrangements have been made, and legal powers taken, formally to call out all those who volunteer to serve under the Reserve Forces Act 1980. We very much hope to meet our requirements for reservists with individuals who express willingness to serve, and that makes it essential that all those who volunteer should have their jobs protected.

Members of the reserve forces are, following call-out, paid the same rates of pay as members of the regular forces, including a full X factor. In addition, they will be entitled to appropriate regular allowances such as separation allowance and local overseas allowance where appropriate. As the House is aware, the Government gave an undertaking that service personnel would not stiffer financially as a result of being sent to the Gulf.

It seemed, therefore, only right and proper that action should also be taken to protect the financial position of members of the reserves who are called out as a result of operations in the Gulf. As my hon. Friend said, in some cases, they will be highly qualified people who receive high levels of remuneration for their work in civil life. Members of the reserves will have arranged their financial commitments, such as mortgage repayments, in the not unreasonable expectation that their earnings would be fairly constant. We therefore concluded that it would not be right for them or their families to suffer in consequence of their decision to volunteer to serve alongside the Regulars.

We are therefore making available a supplement of up to 20 per cent. of service pay, and more in special cases, which will he paid to those members of the Reserves who are called up, in order to make up any difference between their civilian earnings and their military pay which their employers do not make up voluntarily.

The figure of 20 per cent. was designed to protect the great majority of members from any financial loss as a result of being called up, without going so far as to give an entirely open-ended commitment. But, as I have already said, in exceptional cases we are prepared to consider a higher supplement. [Interruption.] I am sure that the hon. Member for Motherwell, North would like to hear my reply, if the hon. Member for Hamilton (Mr. Robertson) would allow him. It is difficult for me to reply courteously to my hon. Friend the Member for Canterbury.

I hope that the House will agree that this scheme is designed to provide a generous degree of income protection for all members of the reserve forces who are supporting the Regulars during the current crisis in the Gulf.

The service pay of the Territorial Army volunteers embodied in the Regular Army for service in the Gulf would not be prejudiced if they continued to receive money from their civilian employers. In those circumstances, however, they would be ineligible for the special pay supplement, which relates to the loss of civilian pay. That would also be the case for those volunteers who continue to receive full rates of service pay while recuperating from injuries.

My hon. Friend the Member for Canterbury has raised a number of issues relating to members of the volunteer forces injured on active service or in training. I shall, in the time available, deal with them as fully as I can.

Members of the reserve forces who are injured in training—as in the case that my hon. Friend mentioned of training in Norfolk—may be paid a disablement allowance at military pay rates during periods of total incapacity when they are unable to pursue their normal civilian employment as a consequence of their injury.

The allowance is paid in respect of loss of earnings, and lasts until the total incapacity ceases, or up to a maximum of 26 weeks from the date of injury. The rate of the allowance is equal to the military salary for the rank held by the member at the time of the injury, abated, as my hon. Friend said, by any sickness benefit received from the Department of Social Security, statutory sick pay received from his civilian employers and sick pay from public funds. Benefits such as company sick pay are also deducted, because otherwise an individual could be better off sick than working.

Should they remain totally incapacitated after six months, or in the event that total incapacity ceases before the expiry of the six-month period but there is a residual disability, they may claim a residual disability award. Arrangements are made for medical examination in order to assess the extent of the disability. An assessment of 20 per cent. disability or greater provides a weekly pension, while an assessment of lower disability leads to a lump sum payment.

If it is necessary for a member to be medically discharged because of an injury which the Ministry of Defence has accepted as attributable to service, the Department of Social Security is asked to take over the case from the date of discharge. If the DSS decides that the disability is of sufficient severity to warrant the award of a war pension, the Ministry of Defence will award an additional pension under the attributable benefits for reservists scheme.

That additional pension will be made at a higher or lower rate depending on whether or not the member loses his civilian job as a result of the injury. If the member loses his civilian job, it will be abated, according to a prescribed formula, in respect of pension benefits received from his civilian employer, but no account will be taken of benefits from personal insurance.

The disablement allowance that I described is designed to compensate for loss of earnings, but I accept that there is an element of rough justice in the system. Some individuals will gain, whilst those with larger civilian salaries will lose if their employers do not continue to pay them in full. However, I assure my hon. Friend that I understand his particular concern over abatement, which he expressed with great force, and my noble Friend the Parliamentary Under-Secretary of State for the Armed Forces, who has particular responsibility for such matters, will review the rules as far as that is concerned.

I am sure that my hon. Friend's views will be welcome to him in that review, but the Ministry of Defence cannot take into account every shade of disparity in civilian incomes or make exact reimbursement of lost earnings.